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THE FOOD SUPPLY                                                                                                    249
and natural factors. It is true that the economist is shy in entering upon long-range projections. The reasons for his shyness are both analytical and practical. The rate of discount is a harsh, practical fact in making economic decisions whether they are private or public decisions. It is a strong analytical factor in determining the relevant time horizon. The higher the rate of discount, the shorter the relevant horizon. In a world where the rates of return to investment are high for reasons of new, highly productive economic opportunities to invest, the discount rate tends to be high. Then, too, the uncertainty about future events also shortens the horizon both in practical matters and in analytic terms. Even 5-year plans must be modified, as a rule, each year as new information becomes available. Moreover, economics tells us that one way of coping with the fog of uncertainty that limits our horizon is to remain sufficiently flexible so that one can act efficiently when new and better information becomes available. But such flexibility must be reckoned against its additional costs. In this connection, it is a serious error not to take into account the rate of obsolescence of the knowledge that we have with regard to food and population and the fragmentary nature of that knowledge.
I shall draw rather heavily upon the now-available data and estimates of the United Nations Food and Agricultural Organization (FAO) setting forth a world plan for agricultural development (4). It is a useful study, full of many new insights. The projections are keyed to 1985, a short 15 years from now. I shall be at pains, however, to point out as I proceed that even this short view is subject to important qualifications. New information already at hand makes it necessary even now to modify these projections.
In closing this section, I wish to enter a protest against the many naive long-range projections pertaining to food and population. There are all too many simplistic extensions of past trends. Birth rates are not established by robots. Parents are not fruit flies in breeding up to the food supply. As parents and as farmers, people the world over respond, for example, to changes in death rates and to changes in the opportunities to produce food, and knowledge about these responses is still very tenuous. The simple game of linking the little that is known to the unknown by appealing to convenient assumptions is the source of many misleading projections. In advancing the state of knowledge, conjectures transformed into assumptions are not sufficient.
THE DYNAMICS OF THE FOOD ECONOMY The basic economic analysis rests on two interacting parts, the demand for
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